June 21, 2024 • 38 mins
Paul Lane and Marc Fandetti discuss the recent economic survey from Monmouth University that showed Americans are focused on high prices and that is shading their economic outlook. The IRS extends freeze of Pandemic-era tax credit amid widespread fraud. Fast-Food customers are shifting to casual-dining chains. Paul LaMonica joins the show to chat about how impactful recent movie releases have been for movie theater chains.
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Episode Transcript
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(00:00):
The Financial Exchanges produced by Money MattersRadio and is hosted by employees of the
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(00:21):
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(00:42):
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Boston is presented by Veterans Development Corporation. FACE is the Financial Exchange with Paul
Lane and Mark Vandebty. Welcome backto the second hour of the Financial Exchange
here. As we kick off thesecond hour, our Boston Celtics are parading
through the city with their championship trophyand we'll get ready to raise banner eighteen
(01:25):
when the next season starts. Takinga look at markets, relatively mixed today,
nothing incredibly significant, Dow Jones upabout forty five points in the s
and P five hundred off a couplepoints through the first couple hours of trading
here. We did get some housingdata in the first hour of the show
that we discussed a little bit.The average median price for an existing home
(01:48):
sold in the month of May wasfour hundred and nineteen thousand. That was
a record high price and a sixpercent increase over where it was last year.
We also talked about Nvidia and thetremendous amount of gains that it has
seen this year. That stock isoff about two and a quarter percent today.
But we'll start the second hour ofour show with just more of a
(02:09):
sort of overall look at the economy. Inflation is something that we certainly have
heavily heavily covered over the last yearplus, as it's been the most significant
economic issue that we're dealing with.There was some research done by Mammoth University
recently where it polled Americans in termsof what they were concerned about financially,
(02:31):
and as of course you would imagine, inflation is at the forefront of most
Americans' minds. Here and Mark,we have reached a point on the inflationary
front where we have made significant progressto get it back down from the highs
that we saw in twenty twenty whereheadline inflation peaked at nine percent year over
(02:53):
year in what was that June orJuly of twenty twenty two, and now
we sit at a level of aboutthree and a half percent or so on
headline inflation. If you look atcore inflation, that number sits relatively similarly
around that same level. And aswe look towards what is going to be
the second half of the year herevery shortly, the Federal Reserve is going
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to continue to have to digest economicreports that are being unveiled. It seems
as if we sit in a pointwhere economic growth has slowed down a little
bit, not to an alarming amount. We've got a labor market that unemployment
has ticked up to four percent,but still sits in a pretty healthy position.
Certainly you could point to some joblessclaims data to perhaps indicate a bit
(03:39):
of a slowing but curious to seeyour thoughts on just where we sit from
an economic standpoint today, with allthat context in terms of inflation and economic
reports coming forward here, I thinkyou summarized it really well. The broad
averages that are used to summarize thestate of the economy by the data collectors
(04:03):
in the federal government Department of LaborDepartment of Commerce, they suggest, relative
to historical experience, a reasonably strongeconomy. This is not consistent with everybody's
lived experience. And what do Imean by reasonably strong? I mean growth
over the past four quarters, includingthe first quarter of this year, in
which its slowed a little bit,is about three percent. That's an average.
(04:27):
Some people will say, I don'tbuy it. I know plenty of
examples firsthand of people who are struggling. But there are others, I guess,
on the other end of the spectrumwho are doing well, who are
better equipped to reap the gains fromthis evolving economy, or just luckier.
However you want to think about it. But economic growth has been reasonably strong,
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especially compared to economic growth potential,which is a product of labor force
growth, which has been slow,and productivity growth, which has picked up
a little but on average over thepast year has not been terrific well twenty
four months. Really past year hasbeen a little bit better. So growth
has been recentably strong, Unemployment epicallylow. Some of you will say,
I don't believe those numbers, orare you accounting people who hold two jobs?
(05:09):
Yes, the statisticians at the Departmentof Labor do take account for things
like that I received. I'm justgonna jump in on the labor front there
because I'm interested your perspective on Someonewas mentioning to me that they were questioning
the labor market numbers because they feltas if immigrants were picking up a lot
of those jobs it wasn't going toUS citizens, And I'm just curious your
thoughts on that theory out there.I mean, it's just looking at job
(05:31):
growth in America in general. Itdoesn't drill bad well. An immigrant is
a US citizen, right unless they'retalking about illegal immigrants, in which case
are they they shouldn't be surveyed yep, but I can't say that they're not,
So I don't know how to respondto that. Yeah, it was
just coin theory kicked around, andso to me, I just what I
said, how about just this ideaabout immigration and labor force growth is one
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of the two pillars, if youlike, key contributors to economic growth.
So we need labor force growth,we need more legal immigration that they're going
to pay my social security someday inyours, so it's not a bad thing.
They not to mention the benefits ofbringing in educated people in particular,
So you can argue, why aren'twe We aren't we taken the educated people
who want who already work here,for example, make them permanent citizens.
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Yeah. Sure, whatever you needto do to grow the labor force legally
helps everybody. Go ahead. No, the question I was going to go
back to is, Okay, iflet's say someone was they were questioning the
labor and market data. But there'smultiple different sources that we utilize. So
this idea that you know to questionthose numbers. What I point to is
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that, hey, you can takeyour pick of several different sources. They're
all pointing in a relatively similar direction. They're all collected. They're largely collected
by the government, some are somecome from like ADP, private sector sources.
Look, the job market is tight, like you said, Paul,
by any measure, there's no pointin denying that. There's no point in
claiming the political party in power isrigging them somehow. It's the same folks
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calculating it. A couple of whomI know. I can say this from
first hand experience career BLS economists,and by that I mean they were there
during Trump, they're there today.The numbers and when when you say,
well the economy was great under Trumpe, based on what your personal experience or
based on statistics, because in twentyeighteen, twenty nineteen it was strong.
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We were hitting nearly three percent GDPgrowth, and he deserves credit for that.
And I suppose by the same standardyou could give the present administration credit
for the relatively strong GDP growth,although I don't give any administration particular credit
at work. There's so many otherforced to points at work. And you
know Trump did run up the deficit. Yes, those tax cuts were very
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stimulative. Biden is running massive deficitsalso very stimulative. So policy can have.
I don't want to poo poo.It entirely can have an influence.
My point is it's the same peoplecrunching the numbers under this administration as we're
crunching it under the last. Andthe last administration used to tout the good
unemployment data, which is calculated bythe same people who are doing it today.
So I'm sorry, but you can'thave it both ways. I couldn't
(08:07):
agree with you more. I justwanted to make sure that I got your
Why are people so down? Accordingto the Monmouth pol that you were citing,
they hate everybody. They don't thinkeither Republicans or Democrats care about the
average American or a particularly well exceptedthat they seem to favor Republicans by a
decent margin. On the economy,maybe remembering the good economic growth years of
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twenty eighteen twenty nineteen, where inflationwas low and growth was about where it
was today. An unemployment where itis about where it was today, it
could be just a function of thatin terms of political preference on that.
That's what I continue to get backto anytime we look at these surveys,
and there has been a numerous amountof places that have collected this information everyone.
First of all, as a country, it seems like we like to
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complain. That just seems like inherentthat everyone just likes to complain in general,
whether it's true the weather or aboutthe economy in general. But the
relation story to me is the end. I'll be all the amount of whether
clients or talking to other show hostshere constantly mentioned the idea that things are
twenty five or thirty percent more expensivethan which is true. They were.
(09:13):
It's true, actually closer to twentyBut that's okay. I'm not anywhere you're
looking at, you know, housingforty or the hous it you know,
housing forty fifty percent, any ofthese items, you know. I quoted
McDonald's earlier on another interview that up, you know, their prices up forty
percent since twenty nineteen. However youslice it price. I used that example
this one. I used my McChickenthis morning as an example. I used
to pay it used to be likea Bucks seventy nine. Now it's three
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dollars. So I just order alot of extra pickles exactly. And it
was the way I used it wasthe big match for you. The Big
Mac is up to nine big macmeal is up to nine dollars and twenty
nine cents. Okay, we don'tdo that. It's a ripoff anything I
do. I'm just quoting the informationof the savvy consumer, not you,
Paul. But you don't have toget the big mac meal every time I
(09:56):
try. If you do get thesoda with no ice, you get more.
So try to say, hear fromit. But why do people think
things are so bad? Because therehas been inflation that we haven't seen over
the last ten or fifteen years,in a very years, yes, right,
and none of us have ever experiencedit. Even I don't remember inflation
relative recently. I guess what Iwas saying is relative to a decade where
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there was minimal inflation at all,and that is going to take a couple
of years to shake off. Asas we've talked about here, the price
level, which is different than inflation. Inflation is the change in the price
level. The price level is justkind of where the average price is.
It ain't going back down other thanunder circumstances of a very bad economy.
(10:41):
You don't want that in the postwar in the post war period, it's
never happened really since the introduction ofthe FED and the idea of fiat money,
money that just can be printed andnot necessarily backed by gold, and
we've been under such a system moreor less since nineteen seventy one. Inflation
will not go down. Apps ina severe economic contraction, the price level
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will not go down. You willnot have deflation, and you do not
want deflation. We had a littlebit of it in two thousand and eight,
and as you will recall those,we're not happy economic circumstances. We
have to adjust to the new pricelevel, while at the same time insisting
that the FED get the rate ofchange in the price level, which when
it goes up we call inflation.Fed's got to get that under control.
Maybe they have, but the jury'sout. You hit the nail on the
(11:24):
head. It's adjust. Eventually,people and consumers will adjust, and we'll
get used to the nine dollars intwenty nine cents Big Mac, or the
three dollars that Mark is paying forhis McChicken. We'll get used to it.
We'll get over it, and we'llmove on. But until then,
these surveys are gona. I resented. I understand the buying a new car.
(11:45):
It's everywhere buying a house the samedeal. We're going to take a
break here on the Financial six Change. When we come back where were playing
a little bit of trivia, andwe'll also have some irs freezing of a
pandemic era, a tax credit that'sright after this big trivia and much much
more. Tune in for trivia broughtto you by Applebee's every day at eleven
(12:05):
twenty. For your chance to wincool prizes. Text us at six one
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rules are available at Financial Exchange Showdot com. This is the Financial Exchange
Radio Network. Miss any of theshow. Catch up at your convenience by
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(12:28):
find all of our interviews in fullshows. This is your home for the
latest business and financial news in NewEngland and around the country. This is
the Financial Exchange Radio Network. Triviais brought to you by Applebee's. Take
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enjoy exclusive deals and specials. You'llget a free appetizer just for signing up.
Now that's eaten good in the neighborhoodvoid, we're prohibited dine in only.
Our look at state capitals continues on. As many of you know,
a lot of the state capitals arenamed after people, such as Montgomery,
(13:16):
Alabama, being named after Revolutionary Wargeneral or Juno, Alaska being named after
a famous gold prospector. But today'squestion is how many state capitals are named
after a president? US president?How many state capitals are named after a
US president? Uh? Be thefirst person to text us at six one
(13:39):
seven three six two one three eightfive with the correct answer, and you'll
win a Financial Exchange Show T shirtand be registered to win a one hundred
dollars gift card to Applebee's. Besure to include the keyword Applebee's in your
text. We are giving away theApplebe's gift card today at six one seven
three six two one three eight five, and the first correct response will be
(14:00):
our winner. See the complete contestrules at Financial Exchange Show dot com.
The IRS is extending their freeze ofthe pandemic era tax credit, which was
the employee Retention tax credit that wascreated in twenty twenty. This allowed for
business to collect up to twenty sixthousand for each employee on its payroll.
The IRS has experienced rampant fraud whenit's come to this program. What rampant's
(14:26):
not strong enough seeable, Okay,adjective, just so foreseeable. They put
a big pile of money out there, and it, like like big piles
of other things, it draws alot of unsavory flies. What ticks me
off is that this measure during thepandemic was well intentioned, but of course
(14:46):
with anything like this, you havebad actors, a lot of them trying
to grab that bag of money.A seamaker who made decisions during the pandemic
should be fired, never let anywherenear the levers of government. Again.
I top to bottom that was sobadly bungled, from our initial response to
closing the economy to these trillions ingiveaways that apparently weren't being audited at the
(15:09):
time, and we continue to livewith the aftershocks in the form of excess
demand. There's a lot of moneystill coming into the economy because of pandemic
era spending that's keeping upward pressure onprices. Paul, why do you feel
that everyone should be fired? AndI mean that in specifically, no one
knew what no one knew what todo when that occurred, one hundred year
(15:30):
pandemic that we had never seen ALEXAbefore. Businesses were shuttered down. So
I have a little trouble playing Mondaymorning quarterback and saying there was soever.
It's my specialty. So was yourview that there should have been no stimulus
at all? Or it was foreseeable? There were plenty of economists arguing at
the time. For number one,you don't shout the whole economy. I
(15:52):
don't want to get into that.That's somewhat political, but from an economic
point of view, that made nosense. There were plenty of people arguing
that at the time. Also waswhen you pump a supply constrained economy full
of trillions and stimulus, that mightpush demand beyond the economy's capacity to reduce,
resulting in inflation. That part wasforeseeable. The abuse of a payroll
protection loans and payments like this wasforeseeable too. The standards were loose the
(16:18):
underwriting was loose. They couldn't pushmoney out the door fast enough, which
politicians and bureaucrats love to do,presumably to curry favor or because it justifies
their existence. All of this stuffwas The abuses were foreseeable at the time.
The inflationary impact was foreseeable at thetime. The lunacy of shutting down
the economy was foreseeable at the time. We had bad management top to bottom,
(16:41):
and people with that type of I'mgoing a little bit beyond the economic
arguments where I'm most comfortable, Butwhat the heck, it's Friday. Anyone
who was in a position of authoritywho made the judgements that were made that
left us with these consequences which wecontinue to live with today, should not
be let anywhere near the levers ofpower anymore. We're very exacting when it
comes to Boeing's EO, for example, we hold them accountable. The door
(17:03):
blew off. No, you weren'tsupposed to tighten the nut, but you
were supervising the person who was supervisingthe person who, et cetera. The
culture was bad, the decisions werebad. We don't hold government officials to
the same standards The idea that wewould let any of these people make decisions,
serious decisions in the in a futurepotential crisis is nuts to me.
Oh they've learned, they'll do abetter job at this time now, I
(17:25):
know. Oh yeah, we gaveHerbert Hoover a second chance. Remember that
James Buchanania screwed up that Fort Sumterthing. We gave him a second chance.
Lincoln had to come in and mopit up up you can, And
if he had a second term,he was going to do great. Herbert
Hoover, he would have fixed theGreat Depression. Just give him another four
years. I don't get that mentality. We're so merciless when it comes to
penalizing failure elsewhere in the economy.Rightfully, so sorry, that's what I'm
(17:48):
not sorry. I'm not one damnbits. That's a lot. At one
point in there, I thought hesaid Lincoln had it coming, and I
was like, WHOA. No,I said, he did the job.
But some might argue, well,you can't have just had another four years.
He might have resolved the Civil war. It might have resolved the dispute
peacefully without civil war. I'm sure. So there are some apologists out there
for him, it blows me away. It is a country that is built
(18:11):
on second chances that won't argue withtheir probably in some domains, yeah,
but not in the severe world offinancial markets, where you fail, you
go out of business. There areoften second acts, but it's munless.
You're a financial institution that's large enoughfor okay, unless talking about the entire
(18:33):
banking sector, Yeah, which isnow too big to fail. I see
your point. A union representing flightattendants for American Airlines said that they were
in talks to extend their deal.This has been a dispute area that's hit
other airlines in the past as well. They did not reach a new contract
really since the pandemic. There hasbeen really tense negotiations between some of the
(18:55):
major airlines out there with its union. It's been an area that has a
short of supply of employees out there, and rightfully so, these employees are
utilizing the leverage that they have asflight attendants to try and get the death
best deal possible. It started intwenty twenty, but it paused these negotiatings
at the height of the pandemic.It's been going on for years. Hopefully
(19:17):
they are able to get some sortof wage increase in a new contract agreed
upon shortly here taking a quick lookaround at markets, we're still in pretty
mixed territory with the major indices offslightly. We're going to take a break
here, but when we come back, we have the answer to trivia and
much more right after this break.Bringing the latest financial news straight to your
(19:45):
radio every day. It's the FinancialExchange on the Financial Exchange Radio Network.
Thankst us six one, seven,three, six, two thirteen eighty five
with your comments and questions about today'sshow and let us know what you think,
talk about the stories we are covering. This is the Financial Exchange Radio
Network, all right. Today's triviaquestion was how many state capitals are named
(20:12):
after a US president? The answerfour. Four state capitals have been named
after a former president. The fourcapitals are Jackson, Mississippi, named after
Andrew Jackson, Jefferson City named afterThomas Jefferson. That's the capital of Missouri,
Lincoln, Nebraska obviously, and Madison, Wisconsin, named after James Madison.
(20:34):
Today's winner is Joyce from Rally.She'll be taking home a Financial Exchange
Show t shirt, and Nathan fromSouth Portland is taking home a one hundred
dollars gift certificate to Applebee's. Triviais brought to you by Applebee's. Enjoy
half price late night appetizers after ninepm and join Club Applebee's to enjoy exclusive
(20:55):
deals and specials. You'll get afree appetizer just for signing up. Now,
that's eating good in the neighbor.Void Work prohibited dine in only Darden
Restaurants, which is the parent companyfor ol of Garden and several other restaurant
chains out there. Their CEO earlierthis week claiming that fast food customers were
starting to make the shift to casualdining chains. The argument that's being made
(21:18):
is that the price, like Markand I have talked about earlier in the
show today of McDonald's, whether itbe a big macmeal or some of the
other items out there, have increasedsignificantly like many food prices over the last
three or four years, and thegap has narrowed slightly to the point where
Chili's and Applebee's and some of thesecasual dining chains are starting to entice customers
(21:41):
to come in with I believe itwas Applebee's that is doing the nine to
ninety nine whole lot of Burger Deal, trying to get share wallet share from
those low income consumers that would perhapsbe spending the money at fast food chains
to now spending at casual dining change. To be clear, there isn't a
significant amount of earnings, you know, evidence to back up this trend,
(22:07):
but certainly something that they're trying togo after these fast food chains about these
casual dining chains. Very different experience. Yeah, and the whole point of
fast food is that it's fast.Yeah, So I don't know if price
unless it's jeez the same or lower. Even then you're not gonna You're just
not gonna wait an app. Butas much as we love Apple Bee's are
(22:29):
great sponsor, there are times whenMcDonald's it's efficiency, yeah right, I
mean you only have five minutes.You're you're pulling up with the kids in
the back, and you wanted aquick turnaround in five minutes. It's not
as conducive to the casual dining whereit is more sit down and there is
a little bit more time that goesinto it. But a lot of the
(22:49):
you know, if you order ahead Paul, that's true, if you
use it to go option again,I'll use Apple Bee's as an example,
because of our partnership and we lovethem. I guess it could in theory
work like fast food a little bitmore planning, though, I mean,
you do have to use the appor call in, but if you timed
it right, I guess it couldbe as convenient as fast food. Yeah.
(23:10):
McDonald's got in the heat of thisdiscussion where Republicans had suggested that their
prices had doubled over the last fiveyears or so, prompting the US President
joe Erlinger to come back and say, wait a minute, they have not
doubled. They're up forty percent sincetwenty nineteen. And we talked about that
or on this show here that theyare trying to prevent some more present,
(23:33):
some more value based options. Theyhave the five dollars value meal deal.
Though I was talking with another hosttoday, Mark that there's some Do you
are you familiar with the specifications onthe five dollars five dollars value meal?
I know, but I bet Ican guess them too reasonable precisions. No.
No, The claim that I heardwas that there were some sort of
(23:56):
caveats to you know, how valuebased that deal really was, Like if
you broke up the bundle. Couldyou do root nearly as well? Yeah,
basically they're making you do. Theydo have the free French Fry Friday
today though. That's something that isan enticing option for people who at least
spend a dollar mobile app purchases ormobile app customers rather can get it for
(24:18):
a dollar. Long and short isthat McDonald's is trying to fight back with
some value options, but it remainsto be seen if these casual fast dining
restaurants or casual dining restaurants can takeshare from fast food giants. McDonald's has
really struggled in a period of timewhere inflation has hit a lot of consumers.
Those price increases have not helped thestock in terms of the gains that
(24:40):
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Housing inventory has been a significant problemin the New England area and it's
not something that's going to be solvedanytime soon really, but there was a
law that's been put in place,the MBTA Communities Law, which requires cities
and towns that are served by theTEA to build more multi family housing options
(26:07):
close to these transit hubs, andas a result of that, you have
had a significant amount of pushback,as you would imagine from all of the
not all many of the residents inthese surrounding towns. These the classic not
in my backyard sort of approach hasbeen often met with a lot of opposition
to multi family projects going on aroundthese areas. There's a piece here that
(26:32):
was done in the Boston Globe,but this is a little bit back but
in Franklin, where a younger residentwas renting out a backyard cars from his
parents and trying to get active topromote the development of housing in areas like
Franklin and other areas around the Bostonarea. But it's been met with a
(26:52):
lot of pushback. It's now Iwould devote that activism time to getting a
better paying job. Start there.Really, if you want to make a
difference, you can. You canstart there for yourself and for your family.
I'm just not sure how agitating forthese massive and Franklin has a couple.
It's next to the town I livein, so I know them as
a couple of massive multifi One ofthem dramatically change the character of a place
(27:15):
called East Central Street that doesn't meana lot to most of you. But
these big multi fi, these thesemulti family behemoths are represent visual blight.
I wouldn't want to live across thestreet from one. So the knot in
my backyard is used as a termof abuse. But if you buy somewhere
because you like the surrounding, it'sa nice, serene place where you can
(27:37):
decompress, and then they decide toput up a five story like the one
I'm referencing on East Central and Franklin, it dramatically changes the character of the
area and changes your enjoyment of theproperty that you purchased under certain expectations.
So to me, again, nimbiais a term of derision. But I
understand now I'm not affected by this, but I sympathize with those who would
(27:57):
say this changes the quality of thearea in which I chose to live,
in which I paid good, goodmoney for. So I sympathize for what
it's worth. Yeah, you wonderif the single family home you know zoning
do they line that up? Doesthat really make a significant difference? But
at some point I just asked thosepeople who mentioned the not in my backyard
(28:19):
to be willing to s acquess tothe fact that you're gonna have to pay
higher property taxes and more for serviceswithin a town. Property tax has ever
gone down with development? I livein rent them. We have the outlets,
which arguably keep our taxes down somewhat. But there's also five cops over
there all the time, and Iimagine a good portion of other services are
(28:42):
devoted to the needs of that particularspace. I tend to question without any
good data, so I don't pushthe issue whether or not on net it's
a good sort of like casinos.State tax has ever gone down. Now
you could make the counterfact, wellthey'd be higher without them. Well,
no one can prove that or disproveit, so let's put the theoretical stuff
(29:03):
aside. I have my suspicions thattaxes would not go down, Maybe they'd
increase less quickly with more development,because you've got to hire more people to
support that. You need more teachersand more public safety people. I'm just
a little bit skeptical of that argument. Oh, our taxes are too high.
Let's bring it another ten thousand citizens. Really, and maybe the data
(29:26):
bear that out. Maybe I needto get better informed. We're going to
take a break here on the FinancialExchange. But when we come back,
we'll be talking to Paul la Monica. That will be right after this break,
talking with Paul Lamonica right after thismissed one of our shows. Catch
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(29:49):
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(30:11):
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(30:34):
dot com. We're joined now byPaul Lamonica, senior markets analysis writer at
Baron's who joins us every Friday atthis time more or less, Paul,
good morning, How are you.I'm good. Thanks? How you guys
doing good? Thank you, Paul. You're a pretty prolific writer. But
today you want to answer the questionfor us our movie chains finally back.
(31:00):
Yeah, that's a great question.I'm not so sure. I'd go so
far to say that they're definitely backfor good and are going to have a
fantastic twenty twenty four. But there'smore optimism after the huge opening weekend for
Inside Out too much better than expected, even though you would think it was
(31:23):
kind of a no brainer that,you know, this is a very popular
Disney Pixar film from twenty fifteen,pent up demand for the sequel given that
it was almost a decade in themaking. But the numbers were much better
than expected, and I think itstruck a lot of people by surprise because
you don't have to wait that muchlonger, only in like, you know,
(31:45):
three months, probably until it comeson Disney Plus. But people really
wanted to go see this in theatersand that helped boost Cinemak and IMAX.
AMC a little volatile, but youknow, AMC is almost divorced from the
fundamentals of the movie theater business,given how much of a meme stock trade
that has become. So speaking offundamentals, there's been a lot of hand
(32:06):
ringing over the past a few years. I'll just oversimplify and say, since
COVID as to whether theaters where themovie theater chains have a secular problem on
their hands due to a shift inpreferences, or is it rather a content
problem? What does the latest evidencesuggest to you? Where do you where
do you fall in that argument?I think that people, as we see
(32:30):
with Inside Out too, they willgo and have the movie theater experience,
even though a lot of people complain. Even before inflation was you know something
that a lot of people are concernedabout. You know, ticket prices have
been going up for years. Theprices of popcorn and other things that you
(32:51):
buy, you know, at theconcession stands much more expensive, so going
to a movie theater and in manyrespects it's like going to a sporting event.
It's not a cheap night out,particularly for a family. But there
are event driven movies. The problem, I think, though, is because
of the strikes last year in Hollywood, both the writer strikes and the actor
(33:12):
strikes. We don't have as manyblockbusters this year. There are hopes that
in twenty twenty five and beyond,as the schedule ramps up again, we
will have more blockbusters that people mightwant to go to theaters and see.
You've got an Avatar sequel. There'sanother Mission Impossible movie with Tom Cruise.
There's a sequel as well for Superman. So there are a lot of movies
(33:37):
that could be the big blockbusters oftwenty twenty five. I don't know if
there are as many blockbusters on thehorizon outside of Inside Out to for the
remainder of this year. Paul Youpoint out that sales are down ticket sales
about a quarter the first half ofthis year relative to last. There's no
chance that something like dynamic pricing orsome sort of differentiated pricing would ever be
(33:59):
applied. It sounds like theater chainsare going to rely on blockbusters to bring
people back. It seems like thatis the case. I think it's a
combination of blockbusters and you know,refurbishing theaters, kind of making them more
of a place that you can reallytruly have a night out that's an event.
I think that's a big reason whySony just announced recently that it's buying
(34:22):
Alamo, which is a very popularsmall movie theater chain. You know,
a lot of people go there forthe experience of dinner and a movie all
in one place. So, youknow, I don't think there are that
many other places like Alamo out therefor a company like Cinemak or AMC or
other large firms to buy. Butyou know, I think that within reason,
(34:44):
you will continue to see movie theatercompanies put money into older theaters,
try and refurbish them and make them, you know, more fancy places for
people to go and enjoy the experience. Paula Monica, Senior Market's analysis writer
A back Burns, thanks so muchfor the insight for joining us as always
on a Friday. Thanks a lot. I have a great weekend, guys.
(35:05):
Take care. What was the lasttime that, uh you guys were
at a movie theater? Are youa frequent movie theater attendee? No,
Mark Ben you ever? The lasttime I went was to see uh,
Mission Impossible, Dead Reckoning part one, so probably about six seven, eight
months ago. Okay, So isit something you do periodically or I'm not
(35:29):
a big movie goer anymore. Youlook for somebody to go with you?
This weekend. What's going on?I want to share it. I'd love
to with two young kids, Mark, don't go there, just leave it
where it was. With two youngkids, it's a little hard to sneak
the computer. Graves and airplane.Oh okay, I've been in a Turkish
sauna bath. I think he saidthat is a phenomen Billy New England's got
(35:58):
The sixteen Best Beaches for Fans isa piece done by the Globe. Here.
Many people familiar with Crane Good HarboringSinging Beach, but in this piece
here they cover a couple others thatyou guys may want to consider listeners out
there. Cahun Hollow Beach and wellFleet was one that was mentioned where it
is nearby the Beachcomber but has afamily family restaurant on the premises. There's
(36:22):
some others that are mentioned in here. Old Silver Beach and Falmouth is one
that I've been to in the past, which has nice tide pools for the
kids to explore and an on siteburger shack. But certainly with the weather
that we've been having over the lastcouple of weeks here it is a destination.
Some of the other ones that mentionedMother's Beach in Kenny Bunk, Maine
(36:45):
is another one. We've got RockHarbor Beach in Orleans. Do you guys
have any particular favorites? Singing Beachis a nice one too that I've been
to around here locally. If Ihave to take my pick nantask, it
was always where we went growing upright in Haull. That was always the
beach of choice. In fact,half the ones you just named, and
I've lived here for almost forty years, I've never even heard of it.
I was blown away by of thesesixteen. I thought I was going to
(37:07):
be able to rattle through each oneand it provides some sort of commentary.
But I feel as if most peoplethey just kind of stick with their guns.
You know, you go to thesame beach that you have closest access
to, and hey, I mean, as long as it's got sand and
the ocean and a drink in yourhand, that's all you can really ask
for. Unless your mark you'd ratherhave a nice chart and some financial times
(37:29):
and a stack of barons, youknow, next to them, maybe in
the backyard, with a cool drinkin hand. Is that more preferential rather
than the beach? In all seriousness. Are you Are you a beach guy
or pool No, nobody wants tosee me at the beach or the pool,
neither. Try to stay out ofthe sun. No, it's not
so much the sun as it isprobably a sense of shame. Get out
(37:53):
of here. You're acting like you'resome four underpound blog that can't go to
the beach. Just no. ButI'm not like a lot of people.
I think I'm just probably self conscious. I don't need to do I don't
need something else to worry about.Need to get out to the beach this
summer. Need to get out tothe beach the summer. Funny thing is
nobody cares like nobody's looking at anyDo you think people noticing your flaws?
(38:16):
That's like everything in general. Idon't. People are locked into their own
lives. That's all the time thatwe have for this episode of the Financial
Exchange. But everyone enjoy their weekends, stay cool, enjoy the rest of
the Celtics parade, and have agreat weekend. We will see you back
here on Monday. Take care,
The Financial Exchanges produced by Money MattersRadio and is hosted by employees of the
Armstrong Advisory Group, a registered investmentadvisor that provides investment advisory services. All
opinions expressed are solely those of thehosts, do not reflect the opinions of
Armstrong Advisory or anyone else, anddo not guarantee profit. Investments can lose
money. This program does not offerany specific financial or investment advice. Please
(00:21):
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decisions. Armstrong and Money Matters Radiodo not compensate each other for referrals and
are not affiliated. This is theFinancial Exchange with Paul Lane and Mark Vandetti,
your exclusive look at business and financialnews affecting your day, your city,
(00:42):
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(01:03):
Boston is presented by Veterans Development Corporation. FACE is the Financial Exchange with Paul
Lane and Mark Vandebty. Welcome backto the second hour of the Financial Exchange
here. As we kick off thesecond hour, our Boston Celtics are parading
through the city with their championship trophyand we'll get ready to raise banner eighteen
(01:25):
when the next season starts. Takinga look at markets, relatively mixed today,
nothing incredibly significant, Dow Jones upabout forty five points in the s
and P five hundred off a couplepoints through the first couple hours of trading
here. We did get some housingdata in the first hour of the show
that we discussed a little bit.The average median price for an existing home
(01:48):
sold in the month of May wasfour hundred and nineteen thousand. That was
a record high price and a sixpercent increase over where it was last year.
We also talked about Nvidia and thetremendous amount of gains that it has
seen this year. That stock isoff about two and a quarter percent today.
But we'll start the second hour ofour show with just more of a
(02:09):
sort of overall look at the economy. Inflation is something that we certainly have
heavily heavily covered over the last yearplus, as it's been the most significant
economic issue that we're dealing with.There was some research done by Mammoth University
recently where it polled Americans in termsof what they were concerned about financially,
(02:31):
and as of course you would imagine, inflation is at the forefront of most
Americans' minds. Here and Mark,we have reached a point on the inflationary
front where we have made significant progressto get it back down from the highs
that we saw in twenty twenty whereheadline inflation peaked at nine percent year over
(02:53):
year in what was that June orJuly of twenty twenty two, and now
we sit at a level of aboutthree and a half percent or so on
headline inflation. If you look atcore inflation, that number sits relatively similarly
around that same level. And aswe look towards what is going to be
the second half of the year herevery shortly, the Federal Reserve is going
(03:16):
to continue to have to digest economicreports that are being unveiled. It seems
as if we sit in a pointwhere economic growth has slowed down a little
bit, not to an alarming amount. We've got a labor market that unemployment
has ticked up to four percent,but still sits in a pretty healthy position.
Certainly you could point to some joblessclaims data to perhaps indicate a bit
(03:39):
of a slowing but curious to seeyour thoughts on just where we sit from
an economic standpoint today, with allthat context in terms of inflation and economic
reports coming forward here, I thinkyou summarized it really well. The broad
averages that are used to summarize thestate of the economy by the data collectors
(04:03):
in the federal government Department of LaborDepartment of Commerce, they suggest, relative
to historical experience, a reasonably strongeconomy. This is not consistent with everybody's
lived experience. And what do Imean by reasonably strong? I mean growth
over the past four quarters, includingthe first quarter of this year, in
which its slowed a little bit,is about three percent. That's an average.
(04:27):
Some people will say, I don'tbuy it. I know plenty of
examples firsthand of people who are struggling. But there are others, I guess,
on the other end of the spectrumwho are doing well, who are
better equipped to reap the gains fromthis evolving economy, or just luckier.
However you want to think about it. But economic growth has been reasonably strong,
(04:47):
especially compared to economic growth potential,which is a product of labor force
growth, which has been slow,and productivity growth, which has picked up
a little but on average over thepast year has not been terrific well twenty
four months. Really past year hasbeen a little bit better. So growth
has been recentably strong, Unemployment epicallylow. Some of you will say,
I don't believe those numbers, orare you accounting people who hold two jobs?
(05:09):
Yes, the statisticians at the Departmentof Labor do take account for things
like that I received. I'm justgonna jump in on the labor front there
because I'm interested your perspective on Someonewas mentioning to me that they were questioning
the labor market numbers because they feltas if immigrants were picking up a lot
of those jobs it wasn't going toUS citizens, And I'm just curious your
thoughts on that theory out there.I mean, it's just looking at job
(05:31):
growth in America in general. Itdoesn't drill bad well. An immigrant is
a US citizen, right unless they'retalking about illegal immigrants, in which case
are they they shouldn't be surveyed yep, but I can't say that they're not,
So I don't know how to respondto that. Yeah, it was
just coin theory kicked around, andso to me, I just what I
said, how about just this ideaabout immigration and labor force growth is one
(05:55):
of the two pillars, if youlike, key contributors to economic growth.
So we need labor force growth,we need more legal immigration that they're going
to pay my social security someday inyours, so it's not a bad thing.
They not to mention the benefits ofbringing in educated people in particular,
So you can argue, why aren'twe We aren't we taken the educated people
who want who already work here,for example, make them permanent citizens.
(06:18):
Yeah. Sure, whatever you needto do to grow the labor force legally
helps everybody. Go ahead. No, the question I was going to go
back to is, Okay, iflet's say someone was they were questioning the
labor and market data. But there'smultiple different sources that we utilize. So
this idea that you know to questionthose numbers. What I point to is
(06:40):
that, hey, you can takeyour pick of several different sources. They're
all pointing in a relatively similar direction. They're all collected. They're largely collected
by the government, some are somecome from like ADP, private sector sources.
Look, the job market is tight, like you said, Paul,
by any measure, there's no pointin denying that. There's no point in
claiming the political party in power isrigging them somehow. It's the same folks
(07:03):
calculating it. A couple of whomI know. I can say this from
first hand experience career BLS economists,and by that I mean they were there
during Trump, they're there today.The numbers and when when you say,
well the economy was great under Trumpe, based on what your personal experience or
based on statistics, because in twentyeighteen, twenty nineteen it was strong.
(07:24):
We were hitting nearly three percent GDPgrowth, and he deserves credit for that.
And I suppose by the same standardyou could give the present administration credit
for the relatively strong GDP growth,although I don't give any administration particular credit
at work. There's so many otherforced to points at work. And you
know Trump did run up the deficit. Yes, those tax cuts were very
(07:45):
stimulative. Biden is running massive deficitsalso very stimulative. So policy can have.
I don't want to poo poo.It entirely can have an influence.
My point is it's the same peoplecrunching the numbers under this administration as we're
crunching it under the last. Andthe last administration used to tout the good
unemployment data, which is calculated bythe same people who are doing it today.
So I'm sorry, but you can'thave it both ways. I couldn't
(08:07):
agree with you more. I justwanted to make sure that I got your
Why are people so down? Accordingto the Monmouth pol that you were citing,
they hate everybody. They don't thinkeither Republicans or Democrats care about the
average American or a particularly well exceptedthat they seem to favor Republicans by a
decent margin. On the economy,maybe remembering the good economic growth years of
(08:28):
twenty eighteen twenty nineteen, where inflationwas low and growth was about where it
was today. An unemployment where itis about where it was today, it
could be just a function of thatin terms of political preference on that.
That's what I continue to get backto anytime we look at these surveys,
and there has been a numerous amountof places that have collected this information everyone.
First of all, as a country, it seems like we like to
(08:50):
complain. That just seems like inherentthat everyone just likes to complain in general,
whether it's true the weather or aboutthe economy in general. But the
relation story to me is the end. I'll be all the amount of whether
clients or talking to other show hostshere constantly mentioned the idea that things are
twenty five or thirty percent more expensivethan which is true. They were.
(09:13):
It's true, actually closer to twentyBut that's okay. I'm not anywhere you're
looking at, you know, housingforty or the hous it you know,
housing forty fifty percent, any ofthese items, you know. I quoted
McDonald's earlier on another interview that up, you know, their prices up forty
percent since twenty nineteen. However youslice it price. I used that example
this one. I used my McChickenthis morning as an example. I used
to pay it used to be likea Bucks seventy nine. Now it's three
(09:35):
dollars. So I just order alot of extra pickles exactly. And it
was the way I used it wasthe big match for you. The Big
Mac is up to nine big macmeal is up to nine dollars and twenty
nine cents. Okay, we don'tdo that. It's a ripoff anything I
do. I'm just quoting the informationof the savvy consumer, not you,
Paul. But you don't have toget the big mac meal every time I
(09:56):
try. If you do get thesoda with no ice, you get more.
So try to say, hear fromit. But why do people think
things are so bad? Because therehas been inflation that we haven't seen over
the last ten or fifteen years,in a very years, yes, right,
and none of us have ever experiencedit. Even I don't remember inflation
relative recently. I guess what Iwas saying is relative to a decade where
(10:18):
there was minimal inflation at all,and that is going to take a couple
of years to shake off. Asas we've talked about here, the price
level, which is different than inflation. Inflation is the change in the price
level. The price level is justkind of where the average price is.
It ain't going back down other thanunder circumstances of a very bad economy.
(10:41):
You don't want that in the postwar in the post war period, it's
never happened really since the introduction ofthe FED and the idea of fiat money,
money that just can be printed andnot necessarily backed by gold, and
we've been under such a system moreor less since nineteen seventy one. Inflation
will not go down. Apps ina severe economic contraction, the price level
(11:03):
will not go down. You willnot have deflation, and you do not
want deflation. We had a littlebit of it in two thousand and eight,
and as you will recall those,we're not happy economic circumstances. We
have to adjust to the new pricelevel, while at the same time insisting
that the FED get the rate ofchange in the price level, which when
it goes up we call inflation.Fed's got to get that under control.
Maybe they have, but the jury'sout. You hit the nail on the
(11:24):
head. It's adjust. Eventually,people and consumers will adjust, and we'll
get used to the nine dollars intwenty nine cents Big Mac, or the
three dollars that Mark is paying forhis McChicken. We'll get used to it.
We'll get over it, and we'llmove on. But until then,
these surveys are gona. I resented. I understand the buying a new car.
(11:45):
It's everywhere buying a house the samedeal. We're going to take a
break here on the Financial six Change. When we come back where were playing
a little bit of trivia, andwe'll also have some irs freezing of a
pandemic era, a tax credit that'sright after this big trivia and much much
more. Tune in for trivia broughtto you by Applebee's every day at eleven
(12:05):
twenty. For your chance to wincool prizes. Text us at six one
seven three, six two one threeeighty five and use keyword Applebee's. Complete
rules are available at Financial Exchange Showdot com. This is the Financial Exchange
Radio Network. Miss any of theshow. Catch up at your convenience by
visiting Financial Exchange Show dot com andclicking the on demand icon, where you'll
(12:28):
find all of our interviews in fullshows. This is your home for the
latest business and financial news in NewEngland and around the country. This is
the Financial Exchange Radio Network. Triviais brought to you by Applebee's. Take
your friends or family to any areaApplebee's and enjoy half priced late night appetizers
after nine pm, including boneless wings, spinach and ardishoke dip, and warm
(12:54):
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enjoy exclusive deals and specials. You'llget a free appetizer just for signing up.
Now that's eaten good in the neighborhoodvoid, we're prohibited dine in only.
Our look at state capitals continues on. As many of you know,
a lot of the state capitals arenamed after people, such as Montgomery,
(13:16):
Alabama, being named after Revolutionary Wargeneral or Juno, Alaska being named after
a famous gold prospector. But today'squestion is how many state capitals are named
after a president? US president?How many state capitals are named after a
US president? Uh? Be thefirst person to text us at six one
(13:39):
seven three six two one three eightfive with the correct answer, and you'll
win a Financial Exchange Show T shirtand be registered to win a one hundred
dollars gift card to Applebee's. Besure to include the keyword Applebee's in your
text. We are giving away theApplebe's gift card today at six one seven
three six two one three eight five, and the first correct response will be
(14:00):
our winner. See the complete contestrules at Financial Exchange Show dot com.
The IRS is extending their freeze ofthe pandemic era tax credit, which was
the employee Retention tax credit that wascreated in twenty twenty. This allowed for
business to collect up to twenty sixthousand for each employee on its payroll.
The IRS has experienced rampant fraud whenit's come to this program. What rampant's
(14:26):
not strong enough seeable, Okay,adjective, just so foreseeable. They put
a big pile of money out there, and it, like like big piles
of other things, it draws alot of unsavory flies. What ticks me
off is that this measure during thepandemic was well intentioned, but of course
(14:46):
with anything like this, you havebad actors, a lot of them trying
to grab that bag of money.A seamaker who made decisions during the pandemic
should be fired, never let anywherenear the levers of government. Again.
I top to bottom that was sobadly bungled, from our initial response to
closing the economy to these trillions ingiveaways that apparently weren't being audited at the
(15:09):
time, and we continue to livewith the aftershocks in the form of excess
demand. There's a lot of moneystill coming into the economy because of pandemic
era spending that's keeping upward pressure onprices. Paul, why do you feel
that everyone should be fired? AndI mean that in specifically, no one
knew what no one knew what todo when that occurred, one hundred year
(15:30):
pandemic that we had never seen ALEXAbefore. Businesses were shuttered down. So
I have a little trouble playing Mondaymorning quarterback and saying there was soever.
It's my specialty. So was yourview that there should have been no stimulus
at all? Or it was foreseeable? There were plenty of economists arguing at
the time. For number one,you don't shout the whole economy. I
(15:52):
don't want to get into that.That's somewhat political, but from an economic
point of view, that made nosense. There were plenty of people arguing
that at the time. Also waswhen you pump a supply constrained economy full
of trillions and stimulus, that mightpush demand beyond the economy's capacity to reduce,
resulting in inflation. That part wasforeseeable. The abuse of a payroll
protection loans and payments like this wasforeseeable too. The standards were loose the
(16:18):
underwriting was loose. They couldn't pushmoney out the door fast enough, which
politicians and bureaucrats love to do,presumably to curry favor or because it justifies
their existence. All of this stuffwas The abuses were foreseeable at the time.
The inflationary impact was foreseeable at thetime. The lunacy of shutting down
the economy was foreseeable at the time. We had bad management top to bottom,
(16:41):
and people with that type of I'mgoing a little bit beyond the economic
arguments where I'm most comfortable, Butwhat the heck, it's Friday. Anyone
who was in a position of authoritywho made the judgements that were made that
left us with these consequences which wecontinue to live with today, should not
be let anywhere near the levers ofpower anymore. We're very exacting when it
comes to Boeing's EO, for example, we hold them accountable. The door
(17:03):
blew off. No, you weren'tsupposed to tighten the nut, but you
were supervising the person who was supervisingthe person who, et cetera. The
culture was bad, the decisions werebad. We don't hold government officials to
the same standards The idea that wewould let any of these people make decisions,
serious decisions in the in a futurepotential crisis is nuts to me.
Oh they've learned, they'll do abetter job at this time now, I
(17:25):
know. Oh yeah, we gaveHerbert Hoover a second chance. Remember that
James Buchanania screwed up that Fort Sumterthing. We gave him a second chance.
Lincoln had to come in and mopit up up you can, And
if he had a second term,he was going to do great. Herbert
Hoover, he would have fixed theGreat Depression. Just give him another four
years. I don't get that mentality. We're so merciless when it comes to
penalizing failure elsewhere in the economy.Rightfully, so sorry, that's what I'm
(17:48):
not sorry. I'm not one damnbits. That's a lot. At one
point in there, I thought hesaid Lincoln had it coming, and I
was like, WHOA. No,I said, he did the job.
But some might argue, well,you can't have just had another four years.
He might have resolved the Civil war. It might have resolved the dispute
peacefully without civil war. I'm sure. So there are some apologists out there
for him, it blows me away. It is a country that is built
(18:11):
on second chances that won't argue withtheir probably in some domains, yeah,
but not in the severe world offinancial markets, where you fail, you
go out of business. There areoften second acts, but it's munless.
You're a financial institution that's large enoughfor okay, unless talking about the entire
(18:33):
banking sector, Yeah, which isnow too big to fail. I see
your point. A union representing flightattendants for American Airlines said that they were
in talks to extend their deal.This has been a dispute area that's hit
other airlines in the past as well. They did not reach a new contract
really since the pandemic. There hasbeen really tense negotiations between some of the
(18:55):
major airlines out there with its union. It's been an area that has a
short of supply of employees out there, and rightfully so, these employees are
utilizing the leverage that they have asflight attendants to try and get the death
best deal possible. It started intwenty twenty, but it paused these negotiatings
at the height of the pandemic.It's been going on for years. Hopefully
(19:17):
they are able to get some sortof wage increase in a new contract agreed
upon shortly here taking a quick lookaround at markets, we're still in pretty
mixed territory with the major indices offslightly. We're going to take a break
here, but when we come back, we have the answer to trivia and
much more right after this break.Bringing the latest financial news straight to your
(19:45):
radio every day. It's the FinancialExchange on the Financial Exchange Radio Network.
Thankst us six one, seven,three, six, two thirteen eighty five
with your comments and questions about today'sshow and let us know what you think,
talk about the stories we are covering. This is the Financial Exchange Radio
Network, all right. Today's triviaquestion was how many state capitals are named
(20:12):
after a US president? The answerfour. Four state capitals have been named
after a former president. The fourcapitals are Jackson, Mississippi, named after
Andrew Jackson, Jefferson City named afterThomas Jefferson. That's the capital of Missouri,
Lincoln, Nebraska obviously, and Madison, Wisconsin, named after James Madison.
(20:34):
Today's winner is Joyce from Rally.She'll be taking home a Financial Exchange
Show t shirt, and Nathan fromSouth Portland is taking home a one hundred
dollars gift certificate to Applebee's. Triviais brought to you by Applebee's. Enjoy
half price late night appetizers after ninepm and join Club Applebee's to enjoy exclusive
(20:55):
deals and specials. You'll get afree appetizer just for signing up. Now,
that's eating good in the neighbor.Void Work prohibited dine in only Darden
Restaurants, which is the parent companyfor ol of Garden and several other restaurant
chains out there. Their CEO earlierthis week claiming that fast food customers were
starting to make the shift to casualdining chains. The argument that's being made
(21:18):
is that the price, like Markand I have talked about earlier in the
show today of McDonald's, whether itbe a big macmeal or some of the
other items out there, have increasedsignificantly like many food prices over the last
three or four years, and thegap has narrowed slightly to the point where
Chili's and Applebee's and some of thesecasual dining chains are starting to entice customers
(21:41):
to come in with I believe itwas Applebee's that is doing the nine to
ninety nine whole lot of Burger Deal, trying to get share wallet share from
those low income consumers that would perhapsbe spending the money at fast food chains
to now spending at casual dining change. To be clear, there isn't a
significant amount of earnings, you know, evidence to back up this trend,
(22:07):
but certainly something that they're trying togo after these fast food chains about these
casual dining chains. Very different experience. Yeah, and the whole point of
fast food is that it's fast.Yeah, So I don't know if price
unless it's jeez the same or lower. Even then you're not gonna You're just
not gonna wait an app. Butas much as we love Apple Bee's are
(22:29):
great sponsor, there are times whenMcDonald's it's efficiency, yeah right, I
mean you only have five minutes.You're you're pulling up with the kids in
the back, and you wanted aquick turnaround in five minutes. It's not
as conducive to the casual dining whereit is more sit down and there is
a little bit more time that goesinto it. But a lot of the
(22:49):
you know, if you order ahead Paul, that's true, if you
use it to go option again,I'll use Apple Bee's as an example,
because of our partnership and we lovethem. I guess it could in theory
work like fast food a little bitmore planning, though, I mean,
you do have to use the appor call in, but if you timed
it right, I guess it couldbe as convenient as fast food. Yeah.
(23:10):
McDonald's got in the heat of thisdiscussion where Republicans had suggested that their
prices had doubled over the last fiveyears or so, prompting the US President
joe Erlinger to come back and say, wait a minute, they have not
doubled. They're up forty percent sincetwenty nineteen. And we talked about that
or on this show here that theyare trying to prevent some more present,
(23:33):
some more value based options. Theyhave the five dollars value meal deal.
Though I was talking with another hosttoday, Mark that there's some Do you
are you familiar with the specifications onthe five dollars five dollars value meal?
I know, but I bet Ican guess them too reasonable precisions. No.
No, The claim that I heardwas that there were some sort of
(23:56):
caveats to you know, how valuebased that deal really was, Like if
you broke up the bundle. Couldyou do root nearly as well? Yeah,
basically they're making you do. Theydo have the free French Fry Friday
today though. That's something that isan enticing option for people who at least
spend a dollar mobile app purchases ormobile app customers rather can get it for
(24:18):
a dollar. Long and short isthat McDonald's is trying to fight back with
some value options, but it remainsto be seen if these casual fast dining
restaurants or casual dining restaurants can takeshare from fast food giants. McDonald's has
really struggled in a period of timewhere inflation has hit a lot of consumers.
Those price increases have not helped thestock in terms of the gains that
(24:40):
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Housing inventory has been a significant problemin the New England area and it's
not something that's going to be solvedanytime soon really, but there was a
law that's been put in place,the MBTA Communities Law, which requires cities
and towns that are served by theTEA to build more multi family housing options
(26:07):
close to these transit hubs, andas a result of that, you have
had a significant amount of pushback,as you would imagine from all of the
not all many of the residents inthese surrounding towns. These the classic not
in my backyard sort of approach hasbeen often met with a lot of opposition
to multi family projects going on aroundthese areas. There's a piece here that
(26:32):
was done in the Boston Globe,but this is a little bit back but
in Franklin, where a younger residentwas renting out a backyard cars from his
parents and trying to get active topromote the development of housing in areas like
Franklin and other areas around the Bostonarea. But it's been met with a
(26:52):
lot of pushback. It's now Iwould devote that activism time to getting a
better paying job. Start there.Really, if you want to make a
difference, you can. You canstart there for yourself and for your family.
I'm just not sure how agitating forthese massive and Franklin has a couple.
It's next to the town I livein, so I know them as
a couple of massive multifi One ofthem dramatically change the character of a place
(27:15):
called East Central Street that doesn't meana lot to most of you. But
these big multi fi, these thesemulti family behemoths are represent visual blight.
I wouldn't want to live across thestreet from one. So the knot in
my backyard is used as a termof abuse. But if you buy somewhere
because you like the surrounding, it'sa nice, serene place where you can
(27:37):
decompress, and then they decide toput up a five story like the one
I'm referencing on East Central and Franklin, it dramatically changes the character of the
area and changes your enjoyment of theproperty that you purchased under certain expectations.
So to me, again, nimbiais a term of derision. But I
understand now I'm not affected by this, but I sympathize with those who would
(27:57):
say this changes the quality of thearea in which I chose to live,
in which I paid good, goodmoney for. So I sympathize for what
it's worth. Yeah, you wonderif the single family home you know zoning
do they line that up? Doesthat really make a significant difference? But
at some point I just asked thosepeople who mentioned the not in my backyard
(28:19):
to be willing to s acquess tothe fact that you're gonna have to pay
higher property taxes and more for serviceswithin a town. Property tax has ever
gone down with development? I livein rent them. We have the outlets,
which arguably keep our taxes down somewhat. But there's also five cops over
there all the time, and Iimagine a good portion of other services are
(28:42):
devoted to the needs of that particularspace. I tend to question without any
good data, so I don't pushthe issue whether or not on net it's
a good sort of like casinos.State tax has ever gone down. Now
you could make the counterfact, wellthey'd be higher without them. Well,
no one can prove that or disproveit, so let's put the theoretical stuff
(29:03):
aside. I have my suspicions thattaxes would not go down, Maybe they'd
increase less quickly with more development,because you've got to hire more people to
support that. You need more teachersand more public safety people. I'm just
a little bit skeptical of that argument. Oh, our taxes are too high.
Let's bring it another ten thousand citizens. Really, and maybe the data
(29:26):
bear that out. Maybe I needto get better informed. We're going to
take a break here on the FinancialExchange. But when we come back,
we'll be talking to Paul la Monica. That will be right after this break,
talking with Paul Lamonica right after thismissed one of our shows. Catch
up anytime by asking your Alexis Smartspeaker to play the Financial Exchange. This
(29:49):
is the Financial Exchange Radio Network.The Financial Exchange streams live on YouTube.
Like our page and stay up todate on breaking business news. All morning.
Loan Face is the Financial Exchange RadioNetwork. Ladies and gentlemen the weekend.
(30:11):
This segment of the Financial Exchange isbrought to you in part by the
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(30:34):
dot com. We're joined now byPaul Lamonica, senior markets analysis writer at
Baron's who joins us every Friday atthis time more or less, Paul,
good morning, How are you.I'm good. Thanks? How you guys
doing good? Thank you, Paul. You're a pretty prolific writer. But
today you want to answer the questionfor us our movie chains finally back.
(31:00):
Yeah, that's a great question.I'm not so sure. I'd go so
far to say that they're definitely backfor good and are going to have a
fantastic twenty twenty four. But there'smore optimism after the huge opening weekend for
Inside Out too much better than expected, even though you would think it was
(31:23):
kind of a no brainer that,you know, this is a very popular
Disney Pixar film from twenty fifteen,pent up demand for the sequel given that
it was almost a decade in themaking. But the numbers were much better
than expected, and I think itstruck a lot of people by surprise because
you don't have to wait that muchlonger, only in like, you know,
(31:45):
three months, probably until it comeson Disney Plus. But people really
wanted to go see this in theatersand that helped boost Cinemak and IMAX.
AMC a little volatile, but youknow, AMC is almost divorced from the
fundamentals of the movie theater business,given how much of a meme stock trade
that has become. So speaking offundamentals, there's been a lot of hand
(32:06):
ringing over the past a few years. I'll just oversimplify and say, since
COVID as to whether theaters where themovie theater chains have a secular problem on
their hands due to a shift inpreferences, or is it rather a content
problem? What does the latest evidencesuggest to you? Where do you where
do you fall in that argument?I think that people, as we see
(32:30):
with Inside Out too, they willgo and have the movie theater experience,
even though a lot of people complain. Even before inflation was you know something
that a lot of people are concernedabout. You know, ticket prices have
been going up for years. Theprices of popcorn and other things that you
(32:51):
buy, you know, at theconcession stands much more expensive, so going
to a movie theater and in manyrespects it's like going to a sporting event.
It's not a cheap night out,particularly for a family. But there
are event driven movies. The problem, I think, though, is because
of the strikes last year in Hollywood, both the writer strikes and the actor
(33:12):
strikes. We don't have as manyblockbusters this year. There are hopes that
in twenty twenty five and beyond,as the schedule ramps up again, we
will have more blockbusters that people mightwant to go to theaters and see.
You've got an Avatar sequel. There'sanother Mission Impossible movie with Tom Cruise.
There's a sequel as well for Superman. So there are a lot of movies
(33:37):
that could be the big blockbusters oftwenty twenty five. I don't know if
there are as many blockbusters on thehorizon outside of Inside Out to for the
remainder of this year. Paul Youpoint out that sales are down ticket sales
about a quarter the first half ofthis year relative to last. There's no
chance that something like dynamic pricing orsome sort of differentiated pricing would ever be
(33:59):
applied. It sounds like theater chainsare going to rely on blockbusters to bring
people back. It seems like thatis the case. I think it's a
combination of blockbusters and you know,refurbishing theaters, kind of making them more
of a place that you can reallytruly have a night out that's an event.
I think that's a big reason whySony just announced recently that it's buying
(34:22):
Alamo, which is a very popularsmall movie theater chain. You know,
a lot of people go there forthe experience of dinner and a movie all
in one place. So, youknow, I don't think there are that
many other places like Alamo out therefor a company like Cinemak or AMC or
other large firms to buy. Butyou know, I think that within reason,
(34:44):
you will continue to see movie theatercompanies put money into older theaters,
try and refurbish them and make them, you know, more fancy places for
people to go and enjoy the experience. Paula Monica, Senior Market's analysis writer
A back Burns, thanks so muchfor the insight for joining us as always
on a Friday. Thanks a lot. I have a great weekend, guys.
(35:05):
Take care. What was the lasttime that, uh you guys were
at a movie theater? Are youa frequent movie theater attendee? No,
Mark Ben you ever? The lasttime I went was to see uh,
Mission Impossible, Dead Reckoning part one, so probably about six seven, eight
months ago. Okay, So isit something you do periodically or I'm not
(35:29):
a big movie goer anymore. Youlook for somebody to go with you?
This weekend. What's going on?I want to share it. I'd love
to with two young kids, Mark, don't go there, just leave it
where it was. With two youngkids, it's a little hard to sneak
the computer. Graves and airplane.Oh okay, I've been in a Turkish
sauna bath. I think he saidthat is a phenomen Billy New England's got
(35:58):
The sixteen Best Beaches for Fans isa piece done by the Globe. Here.
Many people familiar with Crane Good HarboringSinging Beach, but in this piece
here they cover a couple others thatyou guys may want to consider listeners out
there. Cahun Hollow Beach and wellFleet was one that was mentioned where it
is nearby the Beachcomber but has afamily family restaurant on the premises. There's
(36:22):
some others that are mentioned in here. Old Silver Beach and Falmouth is one
that I've been to in the past, which has nice tide pools for the
kids to explore and an on siteburger shack. But certainly with the weather
that we've been having over the lastcouple of weeks here it is a destination.
Some of the other ones that mentionedMother's Beach in Kenny Bunk, Maine
(36:45):
is another one. We've got RockHarbor Beach in Orleans. Do you guys
have any particular favorites? Singing Beachis a nice one too that I've been
to around here locally. If Ihave to take my pick nantask, it
was always where we went growing upright in Haull. That was always the
beach of choice. In fact,half the ones you just named, and
I've lived here for almost forty years, I've never even heard of it.
I was blown away by of thesesixteen. I thought I was going to
(37:07):
be able to rattle through each oneand it provides some sort of commentary.
But I feel as if most peoplethey just kind of stick with their guns.
You know, you go to thesame beach that you have closest access
to, and hey, I mean, as long as it's got sand and
the ocean and a drink in yourhand, that's all you can really ask
for. Unless your mark you'd ratherhave a nice chart and some financial times
(37:29):
and a stack of barons, youknow, next to them, maybe in
the backyard, with a cool drinkin hand. Is that more preferential rather
than the beach? In all seriousness. Are you Are you a beach guy
or pool No, nobody wants tosee me at the beach or the pool,
neither. Try to stay out ofthe sun. No, it's not
so much the sun as it isprobably a sense of shame. Get out
(37:53):
of here. You're acting like you'resome four underpound blog that can't go to
the beach. Just no. ButI'm not like a lot of people.
I think I'm just probably self conscious. I don't need to do I don't
need something else to worry about.Need to get out to the beach this
summer. Need to get out tothe beach the summer. Funny thing is
nobody cares like nobody's looking at anyDo you think people noticing your flaws?
(38:16):
That's like everything in general. Idon't. People are locked into their own
lives. That's all the time thatwe have for this episode of the Financial
Exchange. But everyone enjoy their weekends, stay cool, enjoy the rest of
the Celtics parade, and have agreat weekend. We will see you back
here on Monday. Take care,
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